Insurance Corporation Office of Inspector General (FDIC-OIG) - - PowerPoint PPT Presentation

Federal Deposit Insurance Corporation Office of Inspector General

(FDIC-OIG)

Special Agent Donrich L. Young

Office of Inspector General Federal Deposit Insurance Corporation

▪ Outline:

⬧ History/Overview of FDIC ⬧ IG ACT ⬧ OIG Structure ⬧ Types of Cases

Office of Inspector General

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Office of Inspector General Federal Deposit Insurance Corporation

History of FDIC

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Emergency Banking Act of 1933

• Signed into Law by President Franklin D. Roosevelt on March

9,1933

• Legalized a national banking holiday to quell the cash run on the

banks

The Banking Act of 1933 (Permanent)

• Signed into law on June 16, 1933
• Creates the Federal Deposit Insurance Corporation
• Gives federal oversight to all commercial banks (a 1st)
• Separates commercial & investment banking (Glass-Steagall Act)
• Prohibits banks from paying interest on checking accts
• Allows national banks to branch statewide, if states permit

Office of Inspector General Federal Deposit Insurance Corporation

History of FDIC

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Mission: Created by Congress to Maintain stability & public

confidence in the nation’s financial system by:

• Insure Deposits
• Examine & supervise financial institutions for safety and soundness
• Make large & complex financial institutions resolvable
• Manage Receiverships

Authority

• To provide deposit insurance to banks
• To regulate and supervise state nonmember banks

Administration

• U.S. Treasury and Federal Reserve Board fund the FDIC with initial

loans of $289 million

• FDIC office is established in each state

Office of Inspector General Federal Deposit Insurance Corporation

▪ January 1, 1934: Deposit Insurance Coverage = $2,500 ▪ July 1,1934: Deposit Insurance Coverage ▪ = $5,000

▪ 1950: Deposit Insurance Coverage = $10,000 ▪ 1966: Deposit Insurance Coverage = $15,000 ▪ 1969: Deposit Insurance Coverage = $20,000 ▪ 1974: Deposit Insurance Coverage = $40,000 ▪ 1980: Deposit Insurance Coverage = $100,000 ▪ 2008: Deposit Insurance Coverage = $250,000

Historic Insurance Limits

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Office of Inspector General Federal Deposit Insurance Corporation

▪ 1933: U.S. Treasury & Federal Reserve Board provide initial funding to FDIC in the form of a $289 million loan ▪ 1934: Deposit Insurance Fund = $292 million ▪ 1948: FDIC repays $289 million loan to U.S. Treasury & Federal Reserve Board ▪ 1950: FDIC Act revises and consolidates legislation from Banking Act ⬧ FDIC authority expanded to national & state member banks to assess insurance risk ⬧ Deposit Insurance increases = $10,000 ⬧ Deposit Insurance Fund = $1.2 billion

Timeline of Notable Events

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Office of Inspector General Federal Deposit Insurance Corporation

▪ 1960: Deposit Insurance Fund = $2 Billion ▪ 1980: Deposit Insurance Fund = $11 Billion ▪ 1987: Deposit Insurance Fund = $18.3 Billion ▪ 1990: FDIC Insurance Premium Increases from 8.3 cents to 12 cents per $100 of deposits for the first time since 1933 ▪ January 1,1991: FDIC Insurance Premiums increase to 19.5 cents per $100 of deposits ▪ July 1, 1991: FDIC Insurance Premiums increase to 23 cents per $100 of deposits

Timeline of Notable Events

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Office of Inspector General Federal Deposit Insurance Corporation

▪ 1993: Banks begin paying risked-based premiums vs flat rate ▪ 1994: Deposit Insurance Fund = $21.8 Billion ▪ 2005: FDIC consolidates into 6 regional offices. ▪ 2010: Deposit Insurance Coverage increases to $250,000

⬧ Congress approved a temporary increase from $100K to $250K effective Oct 2008 – Dec 2010. ⬧ Passage of the Dodd-Frank/Consumer Protection Act on July 21, 2010 made the increase permanent

▪ 2018: Deposit Insurance Fund = $95.1 Billion

Timeline of Notable Events

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Office of Inspector General Federal Deposit Insurance Corporation

Bank Failures by RMS Region (2007 through December 31, 2015)

AL 7 GA 91 * FL 72 *

Regions (518 Failures) Atlanta – 188 Chicago - 111 Dallas - 37 Kansas City - 58 New York - 34 San Francisco - 90 * States where Failures were supervised by another region AZ – 5 CHI, 1 KC CA – 3 CHI CO – 1 KC FL – 3 CHI, 1 KC GA – 1 CHI IL – 1 ATL, 1 KC KS – 1 CHI NC – 1 CHI

MS 2 AR 2 TX 11 * MO 16 SC 10 NC 7 * VA 5 WV 1 KY 2 OH 6 IN 3 IL 63 * KS 9 * NE 3 SD 1 MN 23 IA 2 WI 8 MI 13 OK 7 * NY 4

MA 1 NJ 5

PA 8

MD 10

WY 1 CO 10 * NM 3 ID 2 UT 6 * AZ 15 * WA 19 OR 6 NV 12 * CA 40 * LA 2

PR 4

MT ND ME

NH VT CT 1 RI DE

TN 5

HI

AK

* States where Failures were supervised by another region NV – 1 CHI OK – 1 KC TX – 3 CHI UT – 1 NY

Office of Inspector General Federal Deposit Insurance Corporation

▪ 2007 – 3 Failures 2013 – 34 Failures ▪ 2008 – 25 Failures 2014 – 18 Failures ▪ 2009 – 140 Failures 2015 – 8 Failures ▪ 2010 – 157 Failures 2016 – 5 Failures ▪ 2011 – 92 Failures 2017 - 8 Failures ▪ 2012 – 51 Failures 2018 – 0 Failures YTD $ince the Establishment of the FDIC, no depositor has loss any funds due to a commercial bank failure

Bank Failures

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Office of Inspector General Federal Deposit Insurance Corporation

Federal Government Guarantee

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If a Bank fails – the FDIC pays

Office of Inspector General Federal Deposit Insurance Corporation

Inspector General Act 1978

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▪ Signed into Law by President Jimmy Carter effective October 12, 1978

Purpose: To create independent & objective units within each agency whose duty is to combat waste fraud and abuse. Each OIG is headed by a presidentially-appointed Inspector General. There were 12 original Inspectors General. Today there are 72 statutory IGs across the Federal government. Act authorizes OIG to conduct & supervise audits and investigations into the programs & operations of its agency

Office of Inspector General Federal Deposit Insurance Corporation

Office of Inspector General FDIC

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Established – April 17, 1989 per the Inspector General Act Amendments of 1988. OIG MISSION: To Prevent, deter, and detect waste, fraud, abuse, and misconduct in FDIC programs and operations, and to promote economy, efficiency, and effectiveness to the agency.

Office of Inspector General Federal Deposit Insurance Corporation

Homeland Security Act 2002

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December 8, 2003: Pursuant to the Homeland Security Act, Congress granted statutory law enforcement authority to certain OIGs, including the FDIC OIG. Authority: Criminal Investigators employed within the certain OIGs Office of Investigations were authorized to conduct investigations, carry firearms, seek and execute search and arrest warrants, serve subpoenas and to administer oaths affirmations, or affidavits

Office of Inspector General Federal Deposit Insurance Corporation

Office of Inspector General Organizational Structure

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Office of Inspector General Federal Deposit Insurance Corporation

OIG Regional Presence

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▪ Atlanta: SAC Jason Moran ▪ Chicago: SAC Joseph Moriarty ▪ Dallas: SAC Laurie Younger ▪ Electronic Crimes Unit: SAC Tyler Smith ▪ Kansas City: SAC David Anderson ▪ New York: SAC Patti Tarasca ▪ San Francisco: SAC Wade Walters, IV

Office of Inspector General Federal Deposit Insurance Corporation

Special Agents

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▪ Approximately 53 agents with over 1000 years of experience in the white-collar criminal investigations

⬧ Agents with experience from:

• Federal Bureau of Investigation
• Internal Revenue Service
• United States Secret Service
• Offices of Inspectors General with experience working

various criminal and program frauds

• Office of Audits
• Private Sector Experience w/ various professional

certifications: CPAs, CFEs, MBAs

Office of Inspector General Federal Deposit Insurance Corporation

Investigative Support

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▪ Electronic Crimes Unit (ECU):

⬧ Five agents with specialized skill in data mining and forensic analysis on vast volumes of electronic data/evidence ⬧ Assist FDIC with investigation of intrusion and phishing scams

▪ 2 Forensic Accountants (HQ):

⬧ Assist in the tracing of assets and development of investigative leads (HQ)

▪ 3 Financial Analyst (NY, Chicago, Dallas):

⬧ Provide in-depth analysis of financial data and interpret into useful information for investigative & case development

Office of Inspector General Federal Deposit Insurance Corporation

Types of Cases

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▪ Employee Misconduct ▪ Banking Insiders – Tellers to CEOs ▪ Significant Customers Causing Losses ▪ Elder Abuse-Embezzlement ▪ Loan Fraud Scheme Conspiracy ▪ Risky Bank Operations with the potential for losses

Office of Inspector General Federal Deposit Insurance Corporation

PRIORITY for OIG and FDIC – get bad bankers

• ut of the banking

Industry Ban:

NON-PARTICIPATION IN BANKING INDUSTRY. Defendant agrees to consent to any regulatory action taken by a Federal financial institution regulatory agency to permanently remove him from office and/or prohibit him from participating, whether as an institution-affiliated party

• r otherwise, in the conduct of the affairs of any insured depository

institution or depository institution holding company, or any other

• rganizations or entities related to the financial industry, as provided in

section 8(e) of the Federal Deposit Insurance Act, 12 U.S.C. § 1818(e),

• r in any other statute, rule, or regulation.

Bank Insiders

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Office of Inspector General Federal Deposit Insurance Corporation

Investigative Referral Analysis

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▪ Initiated based on referrals or information provided by: ⬧ FDIC (RMS, DRR, Legal): 30% ⬧ OI Initiated (SAR review): 15% ⬧ Main DOJ – US Attorney Offices: 10% ⬧ DOJ – FBI: 20% ⬧ Other LEO: 25%

Office of Inspector General Federal Deposit Insurance Corporation

Contact Information

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SA Donrich L. Young FDIC/OIG 10 Tenth St. NE , Ste. 700 Atlanta, Georgia 30309 (678) 916-2359 Direct (404) 426-2468 Mobile donryoung@fdicoig.gov

QUESTIONS?? & ANSWERS!!